US Jobless Claims Fall to 242,000, Biggest Drop Since 2021

Washington, D.C. – Initial jobless claims in the United States fell by 22,000 to 242,000 in the week ended May 13, the Labor Department reported Thursday.

The decline follows a sharp increase in claims in the previous week, which was attributed to fraud. The Labor Department said that it had identified and removed fraudulent claims from the data, which resulted in the sharp decline in the latest week.

The four-week moving average of initial jobless claims, which smooths out week-to-week volatility, fell by 2,500 to 245,000.

The number of people continuing to receive unemployment benefits fell by 51,000 to 1.37 million in the week ended May 6. The four-week moving average of continuing claims fell by 10,250 to 1.38 million.

The labor market remains strong, with employers adding an average of 400,000 jobs per month in the first four months of 2023. The unemployment rate is at 3.6%, near a 50-year low.

Economists expect the labor market to remain strong in the coming months, with employers continuing to add jobs at a brisk pace. The unemployment rate is expected to remain near its current level.

Analysts’ Comments

“The sharp decline in initial jobless claims is a welcome sign that the labor market remains strong,” said Michael Pearce, an economist at Capital Economics. “The drop in claims suggests that the labor market is still generating jobs at a healthy pace, even as the economy slows.”

“The decline in initial jobless claims is a positive sign for the labor market,” said Andrew Hunter, an economist at Capital One. “The labor market is still very strong, and we expect employers to continue to add jobs at a healthy pace in the coming months.”

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